The Top 15 Banking Features Every Startup Needs

arc team headshot badge.png

Arc Team


Choosing a primary bank may not seem like an important decision at the time, but trust us, it is. The right bank will help set your startup up for early success. Whether that be through introductions to potential investors or customers, helping you maximize your idle cash, or enabling you to bank without fees, they’ll be your partner through it all. The reality is that today there are more choices to bank with than ever before: traditional banks, neobanks, fintech banks, and so much more. While they all fundamentally offer the same products and services, some come with unique features and perks. What might those be, you ask? Dive in and find out!

Breaking down the list of the top banking features startups need

There are ten or so features that every startup needs from their bank, to help differentiate them, we’ve broken down the list into actual features (meaning capabilities the bank has), and benefits or perks that the bank offers.


  • Connection to other banks & accounting systems
  • Money movement - in and out
  • Comprehensive user permissions
  • Customizable spend controls
  • Interest-bearing capabilities
  • Embedded financing
  • Automated or scheduled payments
  • Multi-factor authentication
  • FDIC Insurance


  • Minimal-to-no fees
  • Great customer service
  • Rewards programs and bonus offers
  • Introductions to investors and VCs
  • Discounts on software subscriptions
  • Network of advisory services

Feature #1 - Connection to other banks & accounting systems
When deciding where to park your cash, one of the most important things to understand is what other banks and systems it can connect to. The best-in-class banks can connect to and push or pull funds between one another. They also integrate with accounting systems (such as Quickbooks, Xero, or Zoho Books), to automatically publish transactions into the ledger. By connecting your accounts and systems, you can access an aggregated view of your finances.

Feature #2 - Money movement - in and out
The best banks offer multiple options for you to move money in and out, and between your accounts. The most common forms of money movement include ACH transfers, wire transfers, and RTP payments.

Feature #3 - Comprehensive user permissions
As you’re likely aware, startups need to move quickly. They are often onboarding new team members each week, most of which need access to the company’s accounts. Some need the ability to add/remove team members and spin up new cards (Admin), some only need access to the cards for making software purchases, or ad buys (Standard), and others simply need the ability to view transactions that have already been processed (Bookeeper)—that’s where customizable user permissions come in. The ideal bank should offer at least the three levels of permissions described above.

Feature #4 - Customizable spend controls
Assigning out cards to employees is one thing, making sure they stay within their budget is quite another. Marketing might have an average monthly budget of $500k, whereas customer support may only have a monthly budget of $25k—that’s where customizable spend controls come in. With granular permissions, you can even set the amount each vendor in a particular category can charge a card each month, that’s when these controls become even more powerful.

Feature #5 - Interest-bearing capabilities
Some banks pay yield on balances stored with them, while others do not. If your bank does not pay interest or simply pays out 0.01-0.05% APY, it's time to make the switch. The best banks today pay upwards of 4.00%, 100x higher than the worst ones. For more information on how banks generate these returns, check out this post on yield.

Feature #6 - Embedded financing
The best banks don’t just allow startups to store their capital with them, they also enable them to access even more. Embedded financing products such as credit lines, venture debt, and revenue-based financing enable startups to extend their runway and fuel their growth. Pro-tip: most banks will give startups a discount on the funding if they already bank with them.

Feature #7 - Automated or scheduled payments
Automated payments pay current statement balances in full each billing cycle at least two days before the due date, scheduled payments on the other hand, are manually entered and go out on a particular date each month. Bill pay, is a form of automated payment that saves finance teams countless hours each month—it's a crucial feature for most of the startups we talk to!

Feature #8 - Multi-factor authentication
Security, especially in banking, is of the utmost importance. Multi-factor authentication uses a combination of two or more credentials to verify a user's identity during the login. These credentials rely on knowledge, possession, or inherence for verification. SSO (single sign-on) is also a popular option for securing an account.

Feature #9 - FDIC Insurance
FDIC insurance protects deposits held in U.S. banks and savings associations in event of a bank failure (default). It covers deposits up to $250,000 per depositor, per insured bank, for each account ownership category. Almost all banks in the US offer FDIC-insured accounts, while only some banks offer accounts that are SIPC insured. See this guide for a deep dive into FDIC insurance and SIPC insurance.

Perk #10 - Minimal-to-no fees
Banks can charge fees for just about anything they want, some of the most common include maintenance fees, usage fees, and management fees. These fees can range from a few cents for basic items, like deposits, to hundreds of dollars for more complex items. If possible, try to negotiate your fees, if you can’t then perhaps consider a fee-free bank account.

Perk #11 - Great customer service
Having great customer service should be the mission of every bank, but sadly it's not. Choose a partner that prioritizes your best interests and makes you feel valued.

Perk #12 - Rewards programs and bonus offers
Most banks offer rewards programs for utilizing their services and bonus offers for opening new accounts. These may range from monthly cashback and one-time cash payouts to discounts on account and service fees. Generally speaking, the more comprehensive the program, the better. That said, as the saying goes if it sounds too good to be true, it probably is, so make sure to read the fine print.

Perk #13 - Introductions to investors and VCs
Banks are usually some of the most connected organizations. If you establish a positive relationship with your bank, demonstrate growth, and are in the market for funding, sometimes banks are willing to provide introductions to the investors in their network. These can turn out to be some of the most fruitful conversations you’ll have if you play your cards right.

Perk #14 - Discounts on software subscriptions
Most banks offer a partner program, where depositors can access exclusive discounts for banking with them. These discounts usually range from a few percentage points off the monthly subscription fee, to tens of thousands of dollars worth of free services. These are win-win arrangements: you get a discount and the company gets a new customer.

Perk #15 - Network of advisory services
As mentioned above, banks typically have large networks of industry experts in their ranks. Some banks leverage this network to provide startups with go-to-market, product, design, and sales advisory services. These advisory services are most similar to those offered by startup incubators.

Final thoughts on the top banking features every startup needs

The reality is that there are thousands of banks out there, and most aren’t right for startups. They either don’t have the features startups need, charge too many fees, or have outdated user experiences. The right bank can help position a startup for success, by providing capital, advisory services, and integrated rewards for using the account. More importantly, great banks are for startups when they need them most—good and bad. For the cash management account that’s built for startups' best interests, check out Arc.

Stay up to date

Get the latest from Arc in your inbox:

Share this post